ABSTRACT

This chapter examines the imported content of Malaysia's manufacturing sector by using Hummel's vertical specialization method, based on the input–output (I/O) tables of Malaysia from 2000 to 2010. A decrease in direct and indirect imported content based on Hummel's vertical specialization index is interpreted as an increase in the local content of Malaysia's exports. The results will be compared with the Organization for Economic Co-operation and Development (OECD) trade in value-added data for Malaysia for 1995, 2000, 2005, 2008, and 2009. The chapter uses the information and communications technology (ICT) manufacturing sector as a case study. The ICT sector in Malaysia is classified into five main subsectors –ICTmanufacturing, trade (wholesale and retail trade), services, content and media, and other industries. Here were some changes in the ICT sector in Malaysia from 2005 to 2013 based on the ICT satellite data from the Department of Statistics. The OECD classification of ICT, ICT exports increased from 2003 to 2006.